Time for reflection

Lee Jong-wha
The author is a professor of economics at Korea University.

At this beginning of a new year, I look back on the past five. We would never have imagined all the things we’ve gone through at the beginning of 2016. Too many unthinkable events have taken place. Individuals have their own feelings about what has happened, but many surely had stressful times over the period. On the whole, the country has been on a tumultuous ride that has been largely downhill.

The most dramatic change over the last five years was political. A motion to impeach conservative President Park Geun-hye passed the legislature in December 2016. People took to the streets every weekend throughout the winter and spring — with candles in their hands — to demand the ousting of a sitting president. The Constitutional Court cleared the first-ever presidential removal the following year. President Moon Jae-in from the liberal opposition front won a snap election in May 2017. Vowing to clear away past wrongdoings, a string of senior government officials from past governments went to prison, including Park and her predecessor.

The ruling Democratic Party (DP) won a landslide in the April 15 parliamentary elections last year and rubber-stamped one controversial bill after another thanks to its supermajority in the National Assembly. Amid heightened political conflict, Justice Minister Choo Mi-ae and Prosecutor General Yoon Seok-youl butted heads endlessly over prosecution reforms, fatiguing a public suffering through an unprecedented pandemic.

Relations with North Korea went on a rollercoaster ride. Summits between the two Korean leaders and between those of North Korea and the United States came hot and heavy throughout 2018, raising some hopes that a lasting peace may finally become achievable. The mood dramatically soured, however, and North Korea blew up the inter-Korean liaison office in Kaesong in a symbolic gesture last June. Approval ratings for Moon, a president with an approval rating once hovering above 80 percent, fell to the 30-percent range.

Divisions and conflicts by class, ideology, generation and gender only deepened. The appointment of Cho Kuk as justice minister dominated headlines for weeks, especially tales of his family’s shady behavior. The mayors of Seoul and Busan, who had clean images in the liberal camp, were irrevocably stained by sexual harassment charges. Covid-19 cast a pall over society throughout last year, seriously impairing people’s freedoms and rights. The government’s battle against the virus was successful thanks to the devotion of medical professionals and the cooperation of the public at large. But deaths surged and vaccines were delayed, aggravating public frustration and jitters.

The economy suffered a lot. Growth slowed and income distribution worsened. So-called income-led growth policies, conversion of contract workers to permanent status, and corporate regulation by the Moon administration made matters worse. Moon’s attempts to cool off real estate prices and quash speculation completely backfired, although he keeps trying.

The pandemic dealt a particularly hard blow on society’s most vulnerable. The financial integrity of households and companies deteriorated. According to Bank of Korea data, the household-debt-to-disposable-income ratio soared to 171 percent from 139 percent in 2016. As of last June, 53 percent of small and mid-sized companies did not earn enough to pay interest on their debts. Government debt also has been ballooning.

Society and the economy have been skidding downhill over the last five years, but the government did not change its fundamental course. That is worrying. Human beings repeat mistakes if they overly trust their own intuition and do not recognize their wrongdoings. Daniel Kahneman, a Noble Prize laureate and expert in behavioral economics, famously said, “We can be blind to the obvious, and we are also blind to our blindness.”

But the past does not necessarily define the future. We can make amends and we change our path if we are reasonable in thought and action. Our experiences over the last five years and the pandemic crisis can become a trigger. History shows that massive events like war, pandemics or natural disasters have changed humankind’s path in the past — sometimes for the better.

We should make 2021 a new point at which we defeat Covid-19 and settle political, economic and social confusions to move forward. First of all, a new leadership is necessary to depart from the past. The president must go back to his inauguration promise to unite society. He must expand his narrow talent pool and recruit outsiders who can talk straight and advise well. Policies about the economy as well foreign affairs and education must be revisited with replacement of new ministers and aides. A fresh start is always welcome. The president and other leaders must take responsibility to fight Covid-19 and address economic and social challenges.

The people also must use their voices to keep the powers that be in check. We were too swept up by populist political slogans and misinformation. Irrational overheating has been prevalent in the financial market as it has in political and social realms. We must stop for a while and examine where we are. The next five years should be different from the last. We must seek a new path through new leadership and collective public wisdom.